6 Great Tips to Investing in Gold Coins

Now that the gold price seems to have bottomed out it could be a good idea to diversify into gold. Here is some interesting points to take into consideration if you are looking into buying gold any time soon.


Buying gold bullion is all about finding a safe supplier with low margins. Bullion is really all about margins, the more gold you get for your money the better. However, one type of gold investment that most investors overlook is investing in older gold coins. You can get a range of gold coins from the days of the gold standard (generally ca 1850-1915) for a slightly higher spread.

Buying, for example, French Napoleons (Gold 20 Francs) from early 19th century, or Queen Victoria gold sovereigns, at say 10 % above spot may be a better idea than buying 2014 krugerrands for 2 % above spot.

In order to do this successfully though, you have to know a little bit about the coin collecting market (or know a trustable and knowledgeable coin dealer, who can invest on your behalf). Even though it can be a difficult marketplace the major forces are still supply and demand. Following these 6 points will make sure you end up on the right end of the scale.

1. Stay away from the most common types. Generally this means, the older the better. As gold wears quickly most older gold coins have been melted and re-minted as they fell below a certain minimum weight.

2. Do a bit of historical research and buy a type which has historical relevance. This will ensure a larger number of collectors will be interested. For example, Spanish gold doubloons is one of the most iconic gold coins and a large number of collectors and investors world-wide could be interested.

3. Best is to source your investment personally, meaning in store or at a fair. Or else if you do business online, ask the supplier to pick out the nicer looking coins in the lot for you. If you found yourself a good supplier they will happily do this, especially if you are a returning customer.

4. Choose a type that you like! Investing in gold coins is a fun way of diversifying. You also learn a lot and the feeling of owning a piece of ‘real money’ is something of a bonus.

5. When you want to sell, make sure you get to keep the bulk of your profits. There are several marketplaces out there for collector items. eBay is quite expensive (10 % seller fee), so a better idea is to speak to a dealer who can sell them on their website (www.thecoincabinet.com offers this service at a negotiable fee). For a larger number of coins, where you wouldn’t care much to take pictures of each coin and sell them separately, the best bet may be to consign to an auction.

6. When buying and selling remember this: always fight hard for your price. Whether it’s a bullion dealer wanting 10 % above spot or an auction house wanting 10 % seller fee, it’s usually negotiable. Auction houses have become very expensive, some charging 20 % to their sellers AND buyers. If everyone fought harder to get a better deal prices wouldn’t be so high.

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